Legal maxim

The maxim “Assignatus utitur jure auctoris” literally means “an assignee is clothed with the rights of his assignor”. Once a property is assigned, all the rights of the property go to the assignee. The maxim basically tries to establish the rule of law which says that the assignor cannot assign a greater title to the assignee than what he possesses. The assignor has to make it very clear what rights of the property are being assigned. He cannot assign a right that he does not possess, the assignor has to keep this in mind while assigning. It is a maxim which deals with principal-agent relationship. It defines of the concepts of Agency Law, according to which, an assignee represents his assignor and thus he only possesses those rights which have been conferred upon him. This maxim also forms the basis of Section 49 of the Civil Code Procedure (CPC), which says that every transferee has the same rights that were given to the assignee by the assignor.

Taparia Overseas Pvt. Ltd. & Anr. v. inion of India & Ors.

In this case, the Court emphasised the point that the maxim of Assignatus utitur jure auctoris can be applied to all properties. The Court also held that once, the assignee gets the rights of the property, he is also entitled to all kinds of legal actions that are associated to those rights.

However, there are also exceptions to this maxim. Section 41 and 43 of the Transfer of Property Act deal with such exceptions. Section 41 says that if an ostensible owner of any property transfers it for consideration, the transfer is valid even if it was not the right of the ostensible owner of the property to transfer it. Similarly, Section 43 says that if a person who was not authorised to transfer a property, transfers it regardless, all the subsequent rights that such person may get from the property shall also be transferred. This was held in C. Rameswaran v. N. Sambandam. The learned judge held that unless the transferor has gained subsequent rights, there was no need for the application of Section 43 of the Transfer of Property Act, 1882.